I have searched for information on Catalytic Converters, but could not find an answer to my question:

Does the simple fact that my cat is rattling mean that I am doing damage to any other part of my Jeep? My mileage is great (over 21mpg on hwy) and my power seems to be good (especially for a 4.0). So I have seen none of the other issues that people write about with a bad cat.

Other than sounding annoying, is there any reason for me to replace it?

Just rattling isn't an issue but probably at some point the honeycomb will end up perpendicular to flow and you will get the bad cat symptoms. Like KoreaZJ mentioned it might be several years but it happened to a friend of mine after about a week. When mine started rattling I ordered a new cat that night and welded it in that weekend.

Have you gotten under the Jeep and looked at the cat? Mine rattled like crazy. I looked under it, ended up being the welds to the heat shield on top of the cat had broken, and the sheild was sitting there rattling. When I got the Jeep aligned, Sears was kind enough to take the dumb shield off. No problems with it off. ('Course that was in the cold weather)

I ended up replacing the stock cat with a high flow magnaflow one off amazon for like $60

...I ended up replacing the stock cat with a high flow magnaflow one off amazon for like $60

Cheap. My direct fit Magnaflow from Amazon was $108 in 2011.

One temporary solution I read was to drill long sheet metal screws into the cat so they would hold against the inner elements to prevent rattling. Anyone try this? I figured it would just make an already rattling cat leak and make more noise.

The direct fit ones are more expensive but you can get the universal Magnaflows for about $60. I bought the 2.5" cat and welded it in myself. I've gotten the Jeep smogged a couple times since then and it blew fine. I think the stock pipes are 2.25" but I'm planning on replacing the whole exhaust with 2.5" mandrel bent stuff at some point. On the plus side I was able to correct the twist the previous owners shop welded into it while I was in there.

I just replaced mine yesterday. It was rattling and the noise alone was worth the 130 bucks installed for a new cat. Now no more rattling...and my exhaust sounds healthier. Did find out I have a bad exhaust manifold gasket on the pass side though...its leaking a bit.

The direct fit ones are more expensive but you can get the universal Magnaflows for about $60. I bought the 2.5" cat and welded it in myself. I've gotten the Jeep smogged a couple times since then and it blew fine. I think the stock pipes are 2.25" but I'm planning on replacing the whole exhaust with 2.5" mandrel bent stuff at some point. On the plus side I was able to correct the twist the previous owners shop welded into it while I was in there.

Universal one's cheap, I clamped mine on. I need to use some rtv or something as it isn't sealed very well. OH well.

Since I'm just running a stock exhaust I went with the below Walker cat which is more expensive but it's direct fit and stainless steel. Maybe it's not high-flow like the Magnaflows but it's definitely not as restrictive as the OE cat and has a little more throaty sound.

While pricey at Advance for $121.99 you can enter the TRT41 code in the cart for $40 off for total of $81.99 plus tax w/free shipping. Just ran it through as a test for a 98 4.0 and the code works.